Fitch affirms Gol Linhas

Fitch Ratings said it affirmed Gol Linhas Aereas Inteligentes SA's foreign- and local-currency issuer default ratings, $200 million perpetual bonds and $200 million senior notes due 2017 at BB+ and its national scale rating at AA-(bra).

The outlook is stable.

The agency said the affirmations reflect Gol's low-cost structure, strong cash flow generation, business position and moderate leverage.

The ratings also reflect the company's exposure to fuel cost volatility and other industry-related risks, such as revenue volatility and correlation with the domestic economy, high operating leverage and competitive threats, Fitch said, adding that recent fatal accidents will likely have a negative short-term effect that could lead to a near-term softening in demand and new capacity restrictions at Congonhas and other Brazilian airports.

At March 31, the company had a ratio of total adjusted debt to EBITDAR of 4.1 times and a ratio of net adjusted debt to EBITDAR of 1.9x.

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